This law was set forth by the Government of Honduras to stimulate the establishment of foreign companies seeking the best location for their manufacturing facilities.

Main Characteristics:

• Privately owned and administered.

• The zone itself can be located anywhere within the national territory.

• No resident population

• Commercial and industrial companies which are basically exporters or with similar complementary activities, be they national or international, may be established and operate within the Free Zone in accordance with the provisions set forth in this law.

• The goods and merchandise which are imported and/or exported on the basis of this law shall enjoy total exemption from the payment of custom duties, consular fees, charges and surcharges, internal consumption, production and sales taxes as well as other taxes, encumbrances, fees and surcharges.

• Merchandise entered into the free zone that has not been subjected to any industrial transformation or manufacturing process may be re-exported free of custom duties, fees and other fiscal, municipal or district charges.

• Firms operating in the zone must grant workers all benefits established by the Honduran labor law legislation.

• Entitled to import trucks, buses, pick-ups (not luxuries), ambulances and forklifts needs for the company's operations.

• Foreign merchandise entered into the free zone that has not been subjected to any industrial transformation or manufacturing process may be imported for use or final consumption in the country as long as all requirements and customs regulations, as well as the laws governing are complied with.

• National merchandise entered into the Free Zone which has not been subjected to any industrial transformation or manufacturing process may be exported as long as all the requirements and formalities established in the custom regulations are complied with.

• Merchandise within the Free Zone which has been subjected to any transformation or manufacturing process may be imported for use or final consumption in the country, paying custom duties and any other applicable fees upon entering the country prior authorization of the secretary of state in the Ministry of Industry and Commerce.

• Commercial or trading companies are subject to export or re-export no less than 50% of their annual sales. If it is an industrial company, it should export or re-export no less than 95% of its annual production.

• All national and foreign companies operating in Free Zone, and industrial Export Processing in Free Zone (ZIPS) must exhibit to the Ministry of Industry and Trade the presence of at least one permanent representative with the power and ability to carry out all civil, commercial and labor-related activities and business transactions within the national territory.